The Internet — always ablaze with controversy — is a wildfire these days with revelations about more pernicious government spying, deals between governments and corporate “hacker companies”, and Ellen Pao’s resignation as head of Reddit.

I’ll have things to say about the rest later this week but the Pao blaze is shining brightest right now and there are some important lessons to be drawn from it.

Since last Fall, Pao has been the “interim CEO” of the privately held corporation (a subsidiary of Conde Nast) that owns one of the Internet’s most remarkable phenomenon. In its ten years of existence, Reddit has grown so large and become so complex that it defies definition.

At its core, it’s a message board system, but with 160 million users and tens of thousands of message boards under its roof tied together by dizzying interaction, it is the closest thing the Internet has to a city. True to Internet culture, it’s run by a kind of anarchistic democracy. People start message systems (called “subreddits”) whenever they want about whatever they want and users who start them moderate and control them. You can post text, photos, links to any kind of content you want (including videos) and people answer each other constantly.

For the most part, it works wonderfully, making it potentially a model for larger societies — except that in this case the “mean user” is male between 18 to 29 years old and living in the United States. Whether that particular demographic is a cause or an effect, the fact is that this is no utopia. While most subreddits are friendly informative communities talking about the subreddit’s subject, there are subreddits that are virulently sexist, homophobic and racist. Reddit can, and sometimes does, quickly turn into a lynch mob of immature young men acting destructively and viciously.

Ellen Pao was brought in to deal with the craziness; the craziness has forced her out.

Essentially, the Internet is a giant community comprised of billions of people who connect to each other in virtually every way humans can redefining human relationship and significantly enhancing communication. What’s more, the Internet is fundamentally designed by its users. It is as close to world-wide democratic communications as human society has ever come.

Reddit has developed a way of concentrating that collectivizing energy by building a system of sharing and conversation that is, for the most part, regulated by the people who use it.

What’s it like? Make a list of the first five things you did today: maybe rising, eating breakfast, perhaps reading a paper or watching the news, riding or driving someplace and starting work. Now search for each activity on Reddit and you’ll find several subreddits on that very topic: people sharing information, debating it, providing links on it, posting photos or videos of it. Few of these people, who share their knowledge of and often personal details about these subjects, have ever met in person. In fact, they don’t really know each other because Reddit protects the identities of all users — you can post without submitting your email address.

Such freedom and anonymity is a paradise for those atomized people who, like most of us, crave a community and personal communication but who, in our battered societies, don’t often find it. It is the dream of the Internet realized — human communication at its most free.

The problem is that true freedom and elevated human consciousness that would flourish in a truly free world can’t happen on a message board — not now anyway. Reddit is an oasis surrounded by the scorching desert of oppressive and distorted societies that produce the ignorance, pained anger and isolated bigotry that seems to increasingly plague our world.

The Reddit community, given its demographic, includes people who share the bigotry and destructive nastiness that emanates from their tortured lives and, hidden behind the wall of anonymity, they act that out. Reddit is a magnet for bullying. There are constant harassment campaigns against individuals that start with a post or two and then explode into long threads of vituperative attacks.

There have been many lynch-mob campaigns like the one against Brown University student Sunil Tripathi who was identified, on Reddit, as one of the Boston Marathon bombers, a month after he had already committed suicide. The pain young Tripathi’s family suffered through has become a symbol of the problem of what’s euphemistically called “crowd source investigation”.

Women who express feminist thinking often face long threads of outrageously sexist insults and even threats. The sexism is not only responsive. A subreddit called “TheFappening” famously specialized in nude photos of people, including celebrities, most of them women, few published with consent and some of them taken when they were underage.

Some subreddits are not much more than long threads of shockingly racist rants. In fact, one subreddit, called “Coontown”, is a gathering place for racists with over 10,000 members. It’s not alone. After the Charleston mass shooting in a church, for example, a subreddit was organized expressing admiration and support for racist murderer Dylan Roof.

As Pao herself put it: “In my eight months as Reddit’s CEO, I’ve seen the good, the bad and the ugly on Reddit. The good has been off-the-wall inspiring, and the ugly made me doubt humanity.”

The impression the politically progressive Internet community got from Reddit was that its administrators, with no political focus and considerable pressure from its parent company, didn’t know how to deal with any of this appropriately or perhaps didn’t care.

In fact, one of the most aggressive censorship actions taken by administrators in 2013 was to ban all links to progressive sites like Mother Jones, The Huffington Post, Salon, Alternet, Rawstory, The Daily Kos, Truthout, Media Matters, and ThinkProgress. The reasons given were “to reduce the number of blogspam submissions and sensationalist titles” as well as “bad journalism”. Mother Jones and Huffington links are now allowed; the rest are still banned as are all links to RT (the Russian news site) because administrators claimed it was “Kremlin controlled”.

Confused or not, Reddit’s management could see that this atmosphere, over-shadowing any of Reddit’s considerable achievements, was becoming bad for its image and even worse for its stock offerings and advertising campaigns.

Something had to be done. They hired Ellen Pao.

Some people argue Pao was never right for this job but, given her credentials, it’s hard to imagine anyone more qualified. A lawyer (JD from Harvard Law School) with post-graduate degrees in Electrical Engineering (from Princeton) and an MBA (again from Harvard), Pau is an astounding example of drive, academic excellence and top-of-the-line credentials. She also has had experience at WebTV, a number of Silicon Valley firms (usually as business development exec) and a law firm that frequently deals with the Silicon Valley community. So what she didn’t study in school she picked up on the job.

In a sense, she seemed perfect for Reddit and not only because of her work skills but because of another involvement she had.

At the time she was hired by Reddit, Pau was plaintiff in a highly publicized lawsuit against her former employer: the venture capital firm Kleiner Perkins. Passed over for a major promotion, she charged the firm with sexism and became a kind of champion against sexist discrimination in the male-dominated and testosterone-driven Silicon Valley culture. While she lost the lawsuit — she is apparently appealing — the trial exposed the Valley’s perpetuation of a culture of blatant and often aggressive sexism that dominates Internet technology and business.

The moment she got to Reddit, Pao went to work recruiting more women to the Reddit staff, instituting guidelines against harassment and rewriting the Reddit user rules. Her May announcement of new rules making anyone who personally harasses another user subject to banning from the site if the victim complains and administrators agree, provoked the first anti-Ellen volley. Outraged Reddit users immediately began calling her a “dictator” and rumblings about getting rid of her started. The anti-Pao campaign constituted a small minority but, in a community of 160 million users, a small percentage can emit a deafening roar.

When she banned the five groups that were particularly notorious for their vicious personal harassment and glorification of racist killing and rape, the controversy morphed into activism, with Reddit users ramping up their campaign for her firing. Aside from a constant flow of attacks — many of them openly sexist and racist — users organized several on-line petitions. A Change.org petition calling for her firing attracted 200,000 signatures.

Not a day went by without some message thread about her — much of it obscene and unbelievably racist.

Then a month ago, Victoria Taylor, a Reddit staffer who was a frequent liaison to the subreddit moderators, was fired. No cause for that firing was given but the Reddit community didn’t need one. Hundreds of subreddit moderators made their boards “private”, effectively closing them down and damaging the usage numbers and, of course, the site’s advertising bottom-line. Pao’s resignation was just a matter of time and, last week, it happened.

Her place is being taken over by Steve Huffman, Reddit’s founder and original CEO. “We are thankful for Ellen’s many contributions to Reddit and the technology industry generally,” Huffman’s statement said. “She brought focus to chaos, recruited a world-class team of executives, and drove growth. She brought a face to Reddit that changed perceptions, and is a pioneer for women in the tech industry. She will remain as an advisor to the board through the end of 2015. I look forward to seeing the great things she does beyond that.”

But, he didn’t need to add, not at Reddit.

People leave jobs in this industry and, in some cases, that’s a good thing. Pao herself acknowledged that she had been aloof and insensitive toward the Reddit community. Most tech observers feel she didn’t really “get” how important its users and subreddit moderators are. She seems to have viewed Reddit as yet another company offering a top-down service and turning off the faucet when it didn’t like the water. That is, of course, precisely what Reddit exists to counter-act.

But that contradiction underscores the strain corporations feel when they encounter Internet culture. With stock offerings happening constantly and the corporate parents carefully watching the system’s profitability, how safe is it to let Reddit be completely user-controlled? Not safe enough to allow progressive news websites to be linked from it, for example.

How safe, for that matter, is Reddit itself? The corporate version of “anti-harassment” means that you can’t go after an individual and Reddit, under Pao, established the rule that acts on that. But can anyone argue that a 10,000-person community called “Coontown” isn’t harassment and hurtful? What about the communities that target women, over-weight people, people with physical challenges, immigrants and other “targeted groups”? A cursory search will show there are plenty of those.

Reddit insists that only individual harassment should be banned. Groups like these others are protected under “free speech”. But calling something like Coontown an example of free speech is like treating the shooting of black people in a church like target practice. That subreddit’a content hurts people horribly and encourages the ignorant, victimized mentality that sustains and nourishes racism. Shouldn’t such subreddits be banned? Not, apparently, if you’re a corporation that seeks to avoid controversy as a threat to the bottom-line.

In the more “global” sense, what does a place like Reddit really do for the Internet? Certainly it draws activity and brings people together. But can an environment where women are uncomfortable really help expand an Internet whose technology is still woefully male-controlled and whose culture is awash with testosterone?

Are we to be comfortable when the largest messaging community on the Internet makes people of color feel unsafe? What future are we mapping when black people must think twice about expressing the reality of their lives on an Internet that is still controlled overwhelmingly by white men?

And what about the rest of the world? The Internet’s users are spread across all its continents but the great majority of Reddit users are from the United States. In our current world, with all that’s going on, is that a healthy prospect?

Those are questions Huffman will have to face: questions which could define the future of Reddit. But those same questions also face Reddit’s environment — the Internet. How do we develop a community that realizes the potential of our technological creation while moving us forward toward the kind of society it presages? That, when all is said and done, is the question Elle Pao’s short reign as Reddit chief leaves us all.